Geithner and Carney drawing a fiscal cliff line in the sand?

posted at 5:11 pm on December 3, 2012 by Dustin Siggins

Yesterday, Treasury Secretary Timothy Geithner laid down one of the few definitive lines in the fiscal cliff discussions: Social Security reform is off the table for reform. In addition to taking more money from taxpayers, this appears to be the other line in the sand for the Obama Administration.

Unfortunately, Geithner, President Obama, and the rest of the crew at the White House are ignoring the fiscal realities facing Social Security – problems that include, but are not limited to, how the program is allbut broken, the trust fund will start emptying in 2013, and the program will maybe last another 20 years as it is currently designed. Which means today’s seniors may see some harm, middle-aged Americans will see a lot of harm, and younger Americans will likely face devastatingly higher taxes or benefit cuts.

They’re not just doing it on fiscal policy, either – they’re pulling out all the stops for this deceit. Last week, for example, White House Press Secretary Jay Carney said Social Security is off the table:

While a potential change in calculating Social Security increases was part of the talks with Speaker John A. Boehner last year, the White House press secretary, Jay Carney, made clear on Monday that the administration was not considering changes to the retirement program as part of the deficit talks.

“We should address the drivers of the deficit, and Social Security is not currently a driver of the deficit,” Mr. Carney said.

Carney’s comments are very intellectually dishonest, and he knows it. Just a couple of years ago, after all, the Administration was happy to include Social Security in the federal budget when the program ran a surplus. As explained by the think tank Just Facts (emphasis added):

During the federal government’s 2010 fiscal year…the national debt rose from $12.0 trillion to $13.6 trillion…

The White House…reported that the 2010 federal “deficit” was $1.3 trillion.

The difference between the national debt increase of $1.6 trillion and the reported deficit of $1.3 trillion is attributable to the following accounting practices:

When calculating the reported deficit, the federal government merges the finances of all federal programs into what is called the “unified budget.” Hence, the deficit does not account for the intergovernmental debt that arises when programs such as Social Security loan their surpluses to the federal government.

When the federal government lays out money for programs such as TARP and student loans, the outgo is not fully counted in the deficit. The deficit reflects only what the government expects to lose or gain on these loans.

In short, Jay Carney’s boss was happy to use Social Security to make things look better, but is unwilling to use the same accounting standards when they don’t benefit him. Didn’t someone run against those kinds of budget gimmicks in 2008?

Between Obama’s fiscal cliff proposal and subsequent vacation, and Carney’s and Geithner’s comments, the Administration is finally making its intentions clear: tax the so-called “rich,” cut next-to-nothing from the budget, and claim that this will bring back the glory days of the Clinton era. Never mind that the entire argument ignores at least seven major Clinton-era fallacies, and that a return to the Clinton-era tax rates on the “wealthy” only raises 1.88% of the next decade’s expected spending.

Spending cuts, entitlement reform, and tax reform are the three major keys to economic recovery and preventing the transformation of America into today’s Greece. Unfortunately, Obama’s opening negotiations on the fiscal cliff are not hopeful signs that he takes any of them seriously.

Dustin Siggins is the principal blogger for the Tea Party Patriots, a national grassroots coalition with more than 3,500 local chapters. He is also a co-founder of LibertyUnyielding.com, and the author of a forthcoming book on the national debt. The opinions expressed are his own.

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a return to the Clinton-era tax rates on the “wealthy” only raises 1.88% of the next decade’s expected spending.

What, do we expect taxing the wealthy more to pay for 100% of the entire federal budget? The 1.8% # makes no sense. We should look at the % of the deficit over that period of time the tax cuts offset, still a puny #, probably less than 10%. But the 1.8% is pretty misleading I think.

No matter how good you lie to your wife, when the checking account is empty, its empty.

And blaming it on any previous husband just won’t work.

“We should address the drivers of the deficit, and Social Security is not currently a driver of the deficit,” Mr. Carney said.

So tell us, O’Carney, where does the cash come from when SSA redeems its Special Treasury Notes?

[Answer: General treasury revenue. Thats right...we all have paid into a system which loaned the money to the Treasury, and now we have to pay the loan back. Our own damn money. That is the most ugly part of the SSA scam.]

Spending cuts, entitlement reform, and tax reform are the three major keys to economic recovery and preventing the transformation of America into today’s Greece. Unfortunately, Obama’s opening negotiations on the fiscal cliff are not hopeful signs that he takes any of them seriously.

Shouldn’t it be obvious that the Dear Liar thinks that the BSM will back him all the way on this and that even if He crashes the economy (and all those high taxes on the rich should do the trick) he’ll come out smelling like a rose?

In the 80s, under Reagan many were warning what is happening today would come about. But the Dems called shenanigans, tried terrifying seniors and everyone else, then pushed the issue aside. But, here we are as predicted.

Times change, but liberals don’t. Well-scratch that. Liberals do change, but only in how they get worse.

Sore card time: Lot’s of things bothering me on lots of different subjects.

1. How much will the Democrats spend on the 2014 mid term elections to regain control of the House? Plenty, all they got.
2. Who is Obama? We still do not know if he is a US Citizen. He is the only one that says so and the Democrats have spent $$Millions to keep us from knowing. I don’t mean this Birther thing. No doubt he started out a US Citizen . It’s what happened in Indonesia as a child and Kenya as a young adult the questions my mind.
3. Does Obama want to go over the fiscal Cliff ? I think so. Polisky already stated that she is in favor of suspending the separation of Powers Clause and give Obama Unilateral control of the money flow, almost said BUDGET but then the Decorates have done away with that 4 years ago. If we go over the cliff the Obama can decree a National Emergency.
4. What really happened in Fast and Furious? We will never know since it seems to be swept away to that same place they keep Ruby Ridge and Waco TX. Wouldn’t you know it was the same people.
5. What ever happened in Benghazi? Will we ever hear from these Democrats?
6. Did the Democrats steal the election? I do not think so. Elections are all about the numbers game. The Demarcates played that game better. If a situation came up (buried Benghazi until after the election) and it could give a .001% advantage to the re-election then then took it. All those added up to a win. The Republicans and “We The People” let them get a way with it.
7. Has our government become so convoluted by these elitist, with so many rules, counter rules and exception to rules, that all we have remaining is what they tell us.
8. Have they exempt them selves from so much of what we have to live with on a daily basis that they no longer can “feel or pain” or really care if it will get in the way of “THEIR VERSON OF THE AMERICAN DREAM”? Re-election at any cost?

Pick a point and keep on it. Do not allow them to miss direct, spin, re-spin, lie or sweep under the rug. The only thing that they do not yet control is “The Court of Public Opinion”.

The only thing that they do not yet control is “The Court of Public Opinion”.

jpcpt03 on December 3, 2012 at 5:39 PM

Yes, they do–52% to 48%. And the MSM is at saturation level. CA is basically one-party rule now.

That’s why I say to let the liberals, with minor exceptions requiring a hard fight, have pretty much everything they want. We know the pain to come and many of us are preparing, but the liberals will be caught off guard.

And the pic used for this article, a paper airplane made from one dollar bills going down in flames. So Dustin, is that some kind of Freudian implication that you are in the L.I.B (Let it burn) Burn baby Burn… camp?

What chaos? The MSM stories are already written, with headlines like, “Republicans Run from Responsibility to Their Constituents.”

First paragraph: “In an expected move after the Obama juggernaut, Congressional Republicans abdicate responsibility to those who elected them by caving to every Democrat proposal, thereby solidifying the public mandate for Democrat policies and fixes created during the Bush Administration.

“‘This is a great day for us and for the country,’ says Senate Majority Leader Harry Reid. But we wish the Republicans put up a fight and stood on their principles. Maybe they don’t have any.’”

You know how it’ll go. Then, when Dem policies fail, the new story will be that obstructionist Republicans didn’t give input, in the spirit of bipartisanship, to help Democrats find any flaws that could have made the plan better.

Okay, the Rats want to keep SocSecurity off the table. I say give them exactly what they want, and then tell the disabled whose disability checks will get cut by over 25% come June 2016 exactly who didn’t want to deal with it.

What chaos? The MSM stories are already written, with headlines like, “Republicans Run from Responsibility to Their Constituents.”

First paragraph: “In an expected move after the Obama juggernaut, Congressional Republicans abdicate responsibility to those who elected them by caving to every Democrat proposal, thereby solidifying the public mandate for Democrat policies and fixes created during the Bush Administration.

“‘This is a great day for us and for the country,’ says Senate Majority Leader Harry Reid. But we wish the Republicans put up a fight and stood on their principles. Maybe they don’t have any.’”

You know how it’ll go. Then, when Dem policies fail, the new story will be that obstructionist Republicans didn’t give input, in the spirit of bipartisanship, to help Democrats find any flaws that could have made the plan better.

Our house is paid off and we see this massive slowdown coming. We live in Houston which is not broke but does have over $6 billion in unfunded pension debt that can’t be discussed by our media or local politicians. We are thinking of dropping in a pool and sitting back for awhile with the knowledge local taxes have to go up to deal with what’s coming but realistically the cities will feel the bite first and Texas is in the target of the WH.

As for the “SocSecurity doesn’t add to the deficit” li(n)e, here’s the cash shortfall between FY2013 and FY2022:

- $925 billion if either the Disability and Old-Age and Survivors “Trust Funds” were combined or disability payments were fully-paid out after the DI “Trust Fund” runs out of IOUs in mid-2016. Incidentally, this $925 billion is part of every 10-year deficit figure I’ve seen.
- $704 billion if, when the DI “Trust Fund” runs out of IOUs in mid-2016, disability payments were cut the 25% the “Fund” would be short.

Given, depending on which larger scenario one wants to use, $925 billion is anywhere between 10% and 25% of the problem, it’s ludicrous to take this completely off the table.

Unless you are a liberal Democrat this is not your country. You may be a citizen by birth but now you are an unwelcome tenant with little or no voice in the government. We are a country divided with no hope of reconciliation. Sad but true.

Unless you are a liberal Democrat this is not your country. You may be a citizen by birth but now you are an unwelcome tenant with little or no voice in the government. We are a country divided with no hope of reconciliation. Sad but true.

rplat on December 3, 2012 at 7:09 PM

And they don’t want you to leave until you pay the Reichsfluchtsteuer.

The greatest threat to the prosperity, freedom, and liberty of this country is the current federal government. In my opinion, it is a thing broken beyond repair. It is the government “we the people” have selected. Thus, my plan is to wait until the inevitable crash comes, and begin the “thinning of the herd” that must happen for those who value liberty to once again be in the majority. The takers are NOT my countrymen, they are the enemy, and will be “reduced” by their inability to cope with the crash when nanny government won’t be there to change their nappies. When they come out of their cities, starving and cold, what awaits them will not be pretty, but will be necessary.

What can they offer that’s better than what we have now? More debt, more spending to make more dependents on those who work and pay taxes. Remember, that’s not charity, it will be seen as a legal right. And there will be nothing to stand in its way but those who see for what it is: theft and stifling of America’s promise.